FIRST Great Western will face tough competition for the new Greater Western franchise, with John Laing and GNER announcing they will be jointly bidding for the franchise.

The new franchise, due to be introduced in 2006, will merge services currently run by First Great Western, which runs the Swansea to London Paddington service, Thames Trains and Wessex Trains.

Together they serve 297 stations in South Wales, the West of England and the Thames Valley. The new franchise is expected to account for 65 million passenger journeys annually, generating a turnover of around &#xA3;550m.

John Laing and GNER are forming a new firm, London & Western Railway Company, to bid for the Greater Western franchise when it comes up.

Andy Friend, chief executive of Laing, said, "We are combining the UK rail network's two leading operators to create a powerful bidder.

"Both partners have proven track records of successfully investing to improve their franchises and delivering an efficient and reliable service to customers."

But a spokesman for First Group confirmed that it would be bidding. "It is going to be a tightly fought franchise, one of the biggest in the country and a very high profile franchise but we hope we hope we will have a good chance of retaining it.

"We believe we've offered a good service on Great Western and will be hoping to continue to improve our service levels."